The dream of a sustainable energy future is closer to reality than ever before. Declines in renewable energy costs, new efficiency strategies, and advanced technologies such as distributed energy resources and storage, are giving companies around the globe an opportunity to embrace a sustainable future based on a low-carbon, hyper-efficient economy.

1. 1
Converging on Success
Connecting Energy Efficiency and Sustainability to Make
Commitments, Finance Projects, Innovate and Progress

2. The dream of a sustainable energy future is closer
to reality than ever before. Declines in renewable
energy costs, new efficiency strategies, and advanced
technologies such as distributed energy resources
and storage, are giving companies around the globe
an opportunity to embrace a sustainable future
based on a low-carbon, hyper-efficient economy.
But many organizations find themselves stalled on short-term initiatives
because they can’t get buy-in from internal stakeholders. Often, that’s
because these businesses view sustainability and energy management
as separate or loosely connected efforts. To maximize investments and
outcomes—and truly realize the promise of sustainable energy—these
teams must work in tandem.
2

3. 3
• Public commitments
• Science-based targets
• Certification and reporting requirements
Unlock budget and finance needle-moving projects
with a shared resource efficiency and sustainability fund
• The capex vs. opex debate
• Self-supporting development
• A best practice broadcast
Adopt new technology and evolve to sustain success
by developing a forward-looking, evergreen strategy
• Energy storage response
• A decentralized outlook
• Data-powered sharing
1
2
3
Here are three sustainability- and energy-focused
initiatives happening in companies across geographies,
and how they benefit from integrated thinking, planning
and execution.
Develop precise targets and accelerate progress
by making goal setting a cross-business process
Active Energy Management
Active Energy Management is when energy efficiency, energy
procurement and sustainability teams work together to increase
performance and return on investment through integrated
decision-making and initiatives.
This paper focuses on the opportunities found when energy
efficiency and sustainability teams work together.

4. 4
Develop precise targets
and accelerate progress
by making goal setting a collaborate, cross-
business process.

5. 5
While defining and communicating targets is often the
domain of sustainability and corporate social responsibility
teams, developing significant-yet-attainable goals requires
input from across an organization. And operations and
energy management teams should be at the top of the list
of contributors.
Simply put, sustainability leads need to collaborate with
their energy management peers because of the volume
of emissions tied to energy use. Scope 2 emissions, those
derived from purchased electricity or other power sources,
as defined by the Greenhouse Gas (GHG) protocol, account
for 40 percent of global emissions. And 50 percent of that
total comes from electricity use by businesses1
. Setting a
carbon-reduction goal without a clear view into the
company’s baseline energy consumption and potential for
reduction could result in an ill-advised target.
Public Commitments
The first, obvious and difficult step in making external
commitments to climate action is deciding what those
commitments should be. Goal setting is a layered,
highly nuanced process that requires companies to consider
and analyze a range of internal and external variables.
A too-conservative approach can limit the view of savings
opportunities and lead to competitive disadvantages. It’s
like aiming for a C grade when an A might be possible—
in an environment where peers have all pledged to get
top marks, and internal and external stakeholders expect
similar ambitions.
Setting a 70% renewable energy target
might be a better starting point.
Conversely, far-reaching goals can put organizations in
a position where they don’t have the ability or resources
to succeed. E.g., it may be too challenging or ambitious
to pledge to move to 100 percent renewable energy out of
the gate. In some markets, the ability to contract for offsite
renewable power is limited. Plus, onsite wind and solar may
not be able to address the energy needs and load profile
of a site or group of sites. So, setting a 70-percent renewable
energy target that the company can build on over time
might be a better starting point.

6. 6
That’s why getting an accurate read on current energy use,
as well as developing projections based on the likely growth
of an organization, is recommended as the first phase of the
goal-setting process. This activity inevitably requires time and
input from in-house energy and efficiency-focused specialists.
Energy teams also benefit from the partnership by playing a
key, strategic part in the process, elevating their role beyond
day-to-day operations. They have an opportunity to help set
viable targets rather than being given targets. They have an
early view into company commitments and can be proactive
in developing roadmaps to meet goals. And, finally, these
teams can more easily track projects against critical business
KPIs, reallocate efficiency savings across the business, and
improve internal and external reporting.
In the real world, these combined advantages yield significant
results. For example, Schneider Electric worked with a global
automotive manufacturer to establish and act on aggressive
emissions-reduction targets. By bringing sustainability
and energy management stakeholders together, the company
discovered new efficiency opportunities and used the
energy-savings forecasts to inform its public-facing goals.
The teams worked together as well to create line-item
strategies to trim energy use and incorporate renewable
energy into the global procurement mix. Thanks to the internal
coordination, the company has seen massive progress in just
a few years—20-percent energy reduction—and will meet
its goals much sooner than expected.
Thanks to the internal coordination,
the company has seen massive progress
in just a few years—20% energy
reduction—and will meet its goals
much sooner than expected.

7. 7
Establish science-based targets
Setting goals that align with climate science and support the drive to limit global
warming below the 2-degrees Celsius mark, is gaining corporate momentum.
Almost 350 companies, including large global brands such as Nike, PepsiCo
and Sony, have committed to science-based targets (SBTs).
As the name suggests, establishing SBTs adds complexity, and requires
an additional level of internal and external rigor. (The targets must be reviewed
and approved by the Science-Based Targets Initiative (SBTi) and its technical
advisory group.) This is where organizations can stumble.
The prospect of missteps is greatly diminished, however, when silos are
removed, and energy efficiency and sustainability teams partner throughout
the process.
One significant difference with SBTs from other carbon-reduction goal-setting
is that they require companies to analyze and consider reduction strategies for
all three emissions scopes.
Emission scopes defined
SCOPE 3 EMISSIONS
Indirect emissions that
occur in the value chain
SCOPE 2 EMISSIONS
Emissions from the generation
of purchased energy
Emissions from owned/
controlled sources
SCOPE 1 EMISSIONS

8. 8
Sustainability teams are the primary driver in marshalling
the resources necessary to catalog this information and
develop a high-level roadmap for success. They have a
view into corporate-level data, and usually have the ear of
corporate-level and supply-chain stakeholders. Plus, they
may also understand renewable energy, which is necessary
to achieve SBTs.
But energy management serves an equally crucial function.
As mentioned before, this group has domain over the
operations and programs that account for most of overall
emissions. And energy efficiency is a core component of
any effective carbon-cutting initiative. Not only does it trim
consumption and costs, but it has a multiplier effect in areas
like environmental sustainability, delivering as much as 2.5
times the value of reduced energy use.2
That’s why efficiency
investments can help address six of the UN’s Sustainable
Development Goals.3
Efficiency programs also decrease the baseload that must
be “greened”, making the task and expense of procuring
a given volume of renewable energy less daunting. These
factors combined necessitate that energy managers have a
prime seat at the table when organizations set SBTs or any
climate commitments.
An information technology client recently committed to SBTs
and completed the target-setting process. Its sustainability
and energy management teams worked closely throughout,
collecting the required data, and determining where the
company could pursue on- and offsite renewables, and
optimize energy efficiency across its footprint. The targets
were vetted and approved through the SBTi and, since, they
have announced a commitment to decrease Scope 1 and
Scope 2 emissions 25 percent by 2025, and reduce Scope 3
emissions intensity from the use of its products 25 percent
by 2020. It’s one of several reasons the organization was
listed in Barron’s 100 Most Sustainable Companies in 2018.
Efficiency investments can help address
six of the UN Sustainable Development Goals
Efficiency programs also decrease
the baseload that must be “greened”.

9. 9
Merge certification and reporting requirements
Today’s organizations deal with a variety of certification and
reporting requirements, from ISO 50001 to the EU’s Energy
Efficiency Directive (EED), which can overlap. However, these
overlaps don’t have to create redundancies. Just the opposite.
They can lead to efficiencies that help companies meet their
obligations with minimal effort—if sustainability and efficiency
teams work together.
Increasingly, data needed to make carbon-reduction and
resource-efficiency commitments carry directly over to other
sustainability and energy requirements.
For example, companies that respond to the CDP and the
Global Reporting Initiative (GRI) can use the same data
for both reporting channels, improving consistency and
comparability. Synergies also exist within frameworks such as
GRI and the Dow Jones Sustainability Index (DJSI). Building
certification is another case in point. Companies that pursue
Energy Star or LEED®
certification receive extra points when
responding to GRESB, the global environmental, social and
governance benchmark for real estate assets.
There’s interplay, too, between demand-side audits and
efficiency projects when reporting carbon compliance
through EED, Carbon Reduction Commitment and
California Carbon Allowance programs. Companies can
avoid carbon credits or similar penalties through audits or
committing to efficiency improvements.
There are obvious short-term actions companies can take
while goals are being finalized. These can range from
switching to LED lights to installing onsite solar to doing
an offsite renewable energy deal. It is important to keep in
mind incentives or tax implications that may expire.
Climate
Change,
Human
Rights and
Corruption
Largest
2,500 SP
Firms
Green
House Gas
Emissions
Property
Portfolios
Green
Building
CDP
CARBON
DISCLOSURE
PROJECT
DJSI
DOW JONES
SUSTAINABILITY
INDEX
GRESB
GLOBAL
REAL ESTATE
SUSTAINABILITY
BENCHMARK
GRI
GLOBAL
REPORTING
INITIATIVE
LEED
LEADERSHIP
IN ENERGY
ENVIRONMENTAL
DESIGN
FOCUS

10. 10
Unlock budget and
finance needle-moving
projects
with a shared resource efficiency and
sustainability fund.

11. 11
The capex vs. opex debate
At many companies, operating expenses (opex) and capital expenses
(capex) are in constant competition. And opex-funded work tends to carry
the day because of its limited accounting and tax implications. The outcome
for sustainability, and energy and operations teams is that incremental
improvements to existing programs and related technology get the green light
while new investments—necessary to accelerate initiatives and meet company
commitments—linger in the maybe-next-time column.
However, cross-department collaboration can provide the key to unlocking
capital funds for assets and services that may have longer paybacks, but
also deliver long-term carbon-reduction and efficiency results.
Instead of always focusing on opex, sustainability and energy management
teams can work together to use opex savings to fund larger capex projects.
Think lighting retrofits as a revenue-generator to pay for fuel cells.
The benefit for sustainability teams is that onsite renewables and other
clean energy technologies typically fall into the capex category. If some of
the outlay can be offset by high-ROI efficiency upgrades, the business case
for renewables is much stronger. Using conservation measures to reduce the
energy consumption baseline also right-sizes the investment in renewables,
whether onsite or offsite. The potential for overspending is minimal if a facility or
campus is as energy-lean as possible. And, overall, the portfolio of options for
hitting targets broadens as a result of a close energy-sustainability partnership.

12. 12
When the opex-capex battle no longer exists, the cash curve can be optimized
through sustainable off-balance sheet solutions similar to a utility-like approach
to supply energy savings as a commodity.
For example, a global steel manufacturing company delivered sustainable
efficiency projects at several of its plants through a contract, implying no
minimum capex and considering energy no longer as a cost-center, but rather
as an asset.
Self-supporting development
The strategy of building a bank of sorts to develop larger, CFO-friendly
programs also works in reverse. An organization could buy offsite renewables
through a power purchase agreement (PPA) to jumpstart a GHG-reduction
initiative. This financial tool has the potential to generate a profit, which can be
used to support longer-payback energy projects such as combined heat and
power (CHP) or microgrids. (If the PPA is in a time of low profit, efficiency
savings from the “bank” could also act as a buffer.)
Montgomery County, Maryland, recently used a microgrid-as-a-service model
with a 25-year modified power purchase agreement (PPA). As an alternative to
buying two microgrid systems outright, the county chose to partner with
Schneider Electric and Duke Energy Renewables to develop, own and operate
the systems, thereby incurring zero upfront costs. The onsite power generation
at the two facilities is projected to jointly reduce yearly greenhouse gas
emissions by 3,629 metric tons, ensuring cleaner, more reliable and efficient
power.
What is a PPA?
A power purchase agreement is a
contract between two parties, one that
generates electricity (the seller, or
developer) and one that is looking to
purchase electricity (the buyer or offtaker).
The PPA defines commercial terms for the
sale of electricity between the two parties.
There are two main ways that a PPA can
be structured:
• Direct
(also known as retail or physical); or
• Financial
(also known as virtual or synthetic4
)
Favorable financial and contracting terms
have led corporations to play an increasing
role as the offtaker of renewable energy
directly from project developers via a
PPA. To date, more than 12 gigawatts of
PPAs have been executed by corporations
globally.

13. 13
In this paradigm, sustainability is no longer a cost center, as is often presumed.
And operations teams can think beyond short-term savings. Both are integrated
into the corporate strategy, and create a circular, efficient system for carbon
and energy management.
Rolls Royce used this approach to set and plot a course toward a 30 percent
reduction in energy use and 50 percent reduction in GHG emissions by 2025.
The company has used savings from traditional conservation measures, as well
as energy supply management, to help fund two sizeable solar PV installations
at its U.K. factories.
Schneider Electric also advised one Fortune 500 company on a 100 megawatt
PPA that netted $300,000 in new revenue in 2017. This revenue provided much
needed capital—money that is now available for the company to use to
advance its energy management program.
Efficient sustainability. Or sustainable efficiency. This kind of quid pro quo
benefits and elevates the collective importance of both teams. Plus, ultimately,
it helps businesses meet public or internal targets in a way that quickly
advances climate action and fiscal responsibility.
GHG- and waste-reduction goals
Renewable energy
client success story
$300,000
REVENUE
100 MW
PPA
This revenue provided much needed
capital—money that is now available
for the company to use to advance
its energy management program.

14. 14
A best practice broadcast
An automotive manufacturer was challenged with lack of
visibility of energy and sustainability initiatives and a low level
of consistency across its 74 facilities in 19 countries. Despite
global targets, the firm had little visibility at a site level. And
global policies were being ignored or inconsistently enacted.
The company also suffered from limited collaboration and
unclear accountability. No one was driving the effort to align
all sites and improve efficiency, and there was no way to share
knowledge of what was working. Consequently, sites were
missing targets and experiencing long deployment cycles.
Schneider Electric facilitated energy efficiency workshops at
six sites, and a renewable energy analysis to identify PPA and
self-generation opportunities. As a result, the company quickly
identified up to 20 percent in energy savings—equal to $4
million—on multiple projects with just two-year paybacks.
As a result of Schneider Electric’s
energy efficiency workshops, one
company was able to quickly identify
up to 20% in energy savings.

15. 15
Adopt new technology
and evolve to sustain
success
by developing a forward-looking, evergreen strategy.

16. 16
Connect strategy and technology
Many exciting new technologies and strategies benefit
energy management and sustainability teams. But these
teams need to work together when planning and deploying
technologies to ensure investments are right-sized and will
meet both teams’ goals.
For example, demand response is an energy management
strategy that is increasingly being used in innovative ways
when combined with distributed energy resources (DERs).
Using demand response, utilities are adopting behavioral
programs that encourage customers to curb energy use
during peak hours. These programs are similar to a
customer agreeing to be bumped from an overbooked flight.
With demand response, the regional power grid is
overbooked and the market authority/grid regulating entity
is looking for volunteers to temporarily alter operations
and lower power consumption in exchange for savings.
The savings from participating in demand response programs
can be big. In fact, research has estimated the savings
from demand response in 2015 exceeded 10 percent of retail
electric sales and could reach more than 20 percent by
20205
. Demand response strategies can also help companies
achieve GHG reduction goals, while maintaining reliability
in the power grid by avoiding increasingly high peak
demand levels.
Demand response to
fuel savings opportunities
20202015
10% 20%

17. 17
Energy storage response
Energy storage can be layered onto demand response to drive benefits for
sustainability and energy management teams. In times of temporary excess
of power due to added renewable energy, storage can absorb the excess
and then re-release it later when it’s needed, such as during peak demand
(and cost) periods. Energy storage adoption is growing, and market outlooks
estimate the global opportunity for storage to reach 1,000 gigawatts in the
next 20 years.6
For sustainability teams, cooperation optimizes the benefits of renewable
energy and other DERs, such as onsite solar, when generation does
not match demand. This optimization allows the team to meet energy
renewable energy goals.
With the addition of energy storage, energy management teams can take
advantage of low-cost, off-peak energy when renewable sources are
abundant. Sustainability teams can work with energy management teams to
collect and share data on how much grid-sourced power was avoided by
using onsite renewable energy and energy storage.
Market outlooks estimate the
global opportunity for storage to
reach 1,000 gigawatts in the
next 20 years.

18. 18
A decentralized outlook
Microgrids tie DERs like onsite solar, software-enabled and
data-driven equipment, and energy storage together so they
work optimally, create resilience, and can respond agilely
to outages or fluctuations in electricity supply. Microgrids
can help companies better visualize energy use patterns
and quickly react to optimize total energy spend. The many
connected components that make up a microgrid allow
companies to closely monitor real-time energy consumption,
and deploy renewable or onsite energy sources at optimal
times to save on energy costs. Microgrids are on the rise
in many places in the world, and U.S. microgrid operational
capacity is expected to exceed 3.7 GW by 20207
.
Microgrids provide operational resilience and flexibility on
energy sources to lower costs while reducing corporate
carbon footprint.
For example, Schneider Electric worked with sustainability
and energy teams at the Gordon Bubolz Nature Preserve in
Wisconsin to build a sophisticated microgrid, including five
different DERs—fuel cell, CHP, onsite solar, microturbines
and energy storage. This microgrid is one of the most
advanced in existence, and demonstrates how a microgrid
creates efficiencies, cost savings, and increased reliability
and flexibility while promoting the integration of clean energy.
Because of its microgrid, Bubolz expects to become a net-
zero energy facility, paying no electricity bill and generating
no carbon emissions.
Energy management and sustainability teams need to work
together when developing a microgrid project. Sustainability
goals, and impact on GHG or renewable energy targets
should be considered when determining what energy source
is used to power a microgrid, and what the long-term vision
is. Energy management teams can help right size a microgrid,
and provide a pragmatic approach to meet project goals.
Working together, companies can meet renewable energy
goals, consume less power from the grid and reduce their
dependence on the market power price to ensure facility-level
energy reliability and resiliency.
“What’s most important to us is
the sustainability aspect of the
project—not only the environmental
sustainability but the economic
sustainability the microgrid brings
to our energy budgeting.”
– Gordon Bubolz Nature Preserve

19. 19
Data-powered sharing
Energy and sustainability teams need access to both facility- and portfolio-
level data. Data such as how much energy is consumed, from what source,
and at what price, can be used to find improvement opportunities, set
goals, and internally or externally report progress and key indicators. But
that data is often hard to get, or siloed in one department. Recent research
by Schneider Electric and GreenBiz Research found that though 79 percent
of companies are collecting energy and sustainability data, only 41 percent
centralize that data globally8
. The lack of a company-wide strategy makes
data inaccessible to many areas of the organization that need it to make
decisions.
Only 41% of companies centralize
their energy and sustainability data.
EcoStruxure™ Resource Advisor
Schneider Electric’s enterprise-level,
cloud-based sustainability and energy
management application gives organizations
instant and secure access to energy and
environmental information. From enterprise
metrics to granular
site data, EcoStruxure Resource Advisor
(www.resourceadvisor.com) provides
essential data to improve energy and
sustainability programs.
De-siloing data, and sharing it between sustainability and
energy management benefits both teams. For example:
• Energy procurement data can be used for carbon footprint reporting,
vetting renewable energy procurement opportunities, prioritizing energy
efficiency improvements and building better business cases
for investments.
• Energy consumption data allows for better benchmarking and more
accurate price forecasts, determining onsite renewable energy
opportunities, and quantifying project savings and GHG reduction.

20. 20
1 GHG Protocol Scope 2 Guidance: Electricity Procurement, World Resources Institute
2 Capturing the Multiple Benefits of Energy Efficiency, International Energy Agency
3 Why Energy Efficiency Is Key to Sustainable Development, World Economic Forum
4 What is the difference between direct and financial PPAs? Read more, here.
⁵ Energy Efficiency Resource Standards: A New Progress Report on State Experience, American Council for an Energy-Efficient Economy
6 https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/the-new-economics-of-energy-storage
7 https://www.greentechmedia.com/research/report/gtm-research-note-us-microgrid-market-update-q2-2016#gs.p1JvQME
8 The State of Corporate Energy Sustainability Programs 2018, Schneider Electric
• Sustainability data can be used to improve a business
case for efficiency projects by showing the impact on
GHG goals at the corporate level and increasing employee
engagement on efficiency initiatives.
A medical device client is a good example of how powerful
data sharing can be. After aligning all data on a single
platform, the sustainability, energy management and
procurement teams could holistically look at opportunities for
meeting goals. They identified offsite renewable energy
opportunities and improved energy efficiency goals, leading
to the installation of efficient lighting across all facilities and a
reduction in electricity use. All of this data automatically
feeds itself into reporting efforts, combing key environmental
metrics that the company reports to CDP.

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In this e-book, we have explored strategies your organization
can use to strengthen the link between efficiency and
sustainability teams to maximize results of both programs.
Working with an expert partner in energy management can
elevate these commitments and help your company embrace
a sustainable future. Through technology, software, and
services, Schneider Electric helps organizations in over 100
countries coordinate activities across diverse teams, identify
opportunities, and act on initiatives in ways that are safe,
reliable, efficient and sustainable.
Bring your leadership team together in a collaborative,
strategic workshop to set targets, exchange ideas and
prioritize tactics. We will help you create a implementation
roadmap to guide your organization’s coordinated
sustainability and efficiency efforts.
To get started, contact our Active Energy
Management consultants.